In addition, future foreign profits of US-based firms would be mainly exempt from tax.
There were a number of last-minute changes to the bill in order for it get the 51-49 voted it needed to be passed late on Friday night.
The final legislation is not yet confirmed as the two houses, Senate and Representatives, passed slightly different versions of the bill. These two bills now have to be merged and it offers the chance for further intervention.
The package has been criticised for heavily favouring corporations and the wealthy while raising taxes for the lower and middle class.
Analysts have also predicted that it will add a further $1.5trn (£1.1trn) to the national debt.
Following the winning vote, US President Donald Trump said, “What we're doing is, if you look at it, we're going to grow the country, we're going to grow jobs. We're going to be growing everything.”
Economist Larry Summers has predicted that the bill will cause up to 10,000 more deaths in the US each year, as it will reduce medical insurance coverage by 13 million people.
The UK rate of corporation tax will fall to 17% by 2020 - the lowest in the G20.